you dont have to re-install anything, just use something like norton ghost to take the *complete* contents of the smaller drive onto te larger one...
but scientist is right, with that much difference in capacity it'll likely slow things down... to start with, set the jumper so that it is slave OR secondary (whichever it is called), then create 2 (or more) partitions on the larger drive, one of them 40gb (to match the old one and make a ghost easier)...
then just use ghost (or something like it) to image the old drive to the new small partition. Once that's done, turn the comp off, pull out the old drive and set the new one to master...
both have a disk image program for download... no idea about how well either of them work, but they both seem to be what you need...
one more thing: is the cable you have a high speed ide cable, or one of the old ones? 80-pin or 40-pin... if you don't know what they look like, 40-pin has wires that are about the thickness of the wires if a floppy drive cable, 80-pin is the same width ribbon, same plug, but much tinner wires... If it's a 40-pin, you should probably get an 80-pin from your local, because there's nothing better at killing performance than an old ide cable..